BY ANDREW GIOVINAZZI
March 9, 2025
Yo Pit Crazies,
Everyone that trades or invests wants to know which way the market is going to go tomorrow. After watching stocks for 35 years, that is a difficult game. I prefer to trade a range in what I call a Two Way Trade. That way I don’t need to pick a direction, I just need to have the market move enough. What I have found with the market moves is that the stock moves more than I think if I can hold the position for more than a day or two.
The S&P 500 index (Ticker: SPX) hit the 200 day moving average Friday, traders will hear that all weekend, and bounced on Fed Chairman Powell’s comments on the overall state of the economy. Things look ok but that did not stop traders from hitting the sell button for the last two weeks on a raft of news. None of that news is a surprise in my view as it was already public knowledge.
SPX 1 Month chart with 1 day candles and the 200 day moving average
We might keep bouncing off the 200 day moving average but there is a much more reliable trading pattern to use for the coming week.
Check out how I am setting up for Monday.
SPX moves 2% on average every month
That number is astoundingly high and indeed the norm for my 35 years of trading options both as an exchange member and a retail option trader/mentor. The key is you have to stay in. The trades need to pay for the 2% move and indeed that is how I am set up for next week.
Instead of a 2% move per month, heck we got near a 2% move in a day on Friday, Remember SPX traded well below 5700 A VIX near 24 means the market assumes a 1.5% per day on average close to close. This is an ideal situation for Two Way Trades.
Sign up for my class on Wednesday and get my Favorite Indicator Ebook and Video. My guess is to launch over 100 points at some point next week. My Two Way Trade will be along for the ride.
To Your Trading Success,
AG
Andrew Giovinazzi
30-Year Trading Pro
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CAPITOL GAINS: SMR Aug16 7 call closed for a 150% gain
DELTA STRIKE: VLY Mar15 8 puts closed for a 88% gain
PFE May17 26 calls closed for a 66% win
OP MENTORING: SPY Mar22/19 510 put calendars and 520 calls for 6.4% gain
OPTION SHOPPER: ERX Mar28 65 calls closed for a 90% gain